Chinese shares jumped on Wednesday, rising for a fourth straight session, after U.S.President Donald Trump suggested the deadline for Beijing and Washington to strike a trade deal could be pushed back.
HONG KONG: Chinese shares jumped on Wednesday, rising for a fourth straight session, after U.S.President Donald Trump suggested the deadline for Beijing and Washington to strike a trade deal could be pushed back.
The Shanghai Composite index closed 1.8 percent higher at 2,721.07 points, a level not seen since Oct. 10, 2018.
The blue-chip CSI300 index rose 2 percent to its highest point since late September.
Both indices marked their largest daily percentage gains since Jan. 4.
The CSI300 financial sector sub-index added 1.9 percent, the consumer staples sector rose 1.6 percent, while healthcare shares gained 1.5 percent.
U.S. President Donald Trump said on Tuesday that he could let the March 1 deadline for a trade agreement with China ”slide for a little while”, hinting at a possible delay for the first time.
Trump’s advisers have previously described March 1 as a ”hard deadline”, after which U.S. tariffs on $200 billion worth of imports from China will rise to 25 percent from 10 percent, if the two sides cannot reach a deal.
U.S. Treasury Secretary Steven Mnuchin and Trade Representative Robert Lighthizer arrived in Beijing on Tuesday for talks with Chinese officials. Discussions among deputy-level officials to work out technical details, including a mechanism for enforcing any trade agreement, started on Monday.
Trade optimism added to improving domestic sentiments seen in recent sessions, paving the way for investors who withdrew to the sidelines when the market slid last year to return, said Zhang Qi, an analyst at Haitong Securities in Shanghai.
“Valuations are still relatively low,” he said.
However, if ”there is no clear result from the Sino-U.S. negotiations, external risks such as volatility in U.S. stocks could transmit into China, which could increase the volatility in the stock market,” analysts at Chuanchai Securities wrote in a note on Wednesday.
Encouraged by Beijing’s commitment to develop core technologies and innovative capabilities to reduce dependence on foreign technology, CSI’s information technology index climbed 3.4 percent, while its All Share Telecommunications Services Index rallied 5 percent.
The smaller Shenzhen index and the start-up board ChiNext Composite index rose 1.9 percent each.
Around the region, MSCI’s Asia ex-Japan stock index was firmer by 0.6 percent, while Japan’s Nikkei index closed up 1.3 percent.
The largest percentage gainers in the main Shanghai Composite index were Routon Electronic Co Ltd, Deluxe Family Co Ltd and China Galaxy Securities Co Ltd , all up by 10.1 percent.
So far this year, the Shanghai stock index is up 9.1 percent.
The index is above its 50-day moving average and below its 200-day moving average.
About 24.4 billion shares were traded on the Shanghai exchange. The volume in the previous trading session was 18.4 billion. - Reuters
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